New Insights on the US OIS Spreads Term Structure During the Recent Financial Turmoil

Claudio Morana: WP CeRP 137/13

Abstract

 

The paper investigates the statistical features of the US OIS spreads term structure during the recent …nancial turmoil, originating from
the subprime crisis and the ensuing euro area sovereign debt crisis. By means of a comprehensive econometric modeling strategy, new
insights on US money market dynamics during the latter events are achieved. In particular, three common factors, bearing the interpreta-tion of level, slope and curvature factors, are extracted from the term structure of US OIS spreads; the latter are found to convey additional information, relatively to commonly used credit risk measures like the TED or the BAA-AAA corporate spreads, which might be exploited, also within a composite indicator, for the construction of a macoreco-nomic risk barometer and macroeconomic forecasting.

Data di pubblicazione: Dicembre 2013

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